It has been another up week for most of the metals, with gold up 1% to $1,954, silver up 1% to $24.86, and platinum up 5% to $990. Palladium was the only outlier, down 3% to $1,273.
Since a year ago today, gold is up 13%, silver is 35% higher, platinum is up 16%, and palladium is down 40%.
For the last year and a half, we have heard mostly downward news on the price of palladium. But this is likely beginning to change. Looking back to 1982, palladium is up 7200%, which is a pretty good long-term run. Plotting those numbers on a curve indicates it is likely going higher from here.
With palladium producers at record-long positions in the futures markets, while hedge funds are at record short positions, it appears that a “short squeeze” in palladium could be forthcoming. This would be like the scenario that occurred in the nickel market last year, but in reverse.
Back then, it was producers who were at risk; this time, it was the hedge funds.
A short squeeze happens when those betting on a lower palladium price have to make purchases of palladium to honor the contracts while the price is rising, causing prices to rise further. With 80% of palladium mined in BRICS nations, it is a great time to own palladium.